Nasdaq's New Hurdle for Crypto Investments
Nasdaq has unveiled a new rule requiring shareholder approval for companies planning to use stock issuances to purchase cryptocurrencies. This development comes amidst a surge in companies adding crypto to their treasuries, with a total of $132 billion earmarked for such purchases this year.
Key Points
Rule Details: The new rule is part of Nasdaq's existing listing standards, which already mandate shareholder approval for certain transactions. The exchange's enforcement arm ensures compliance with these rules and federal securities laws.
Market Reaction: Crypto-treasury stocks fell during Thursday's trading session following the announcement. However, interest in pure-play crypto exposure remains strong, as evidenced by the debut of American Bitcoin on Nasdaq, which closed its first day up 16.5 percent.
Regulatory Landscape: The SEC has released a rulemaking agenda that includes clearer guidelines for offers and sales, as well as paths to trade on national securities exchanges. Separate House and Senate proposals are also being considered to delineate jurisdiction between the SEC and CFTC.
Impact on Companies: The new rule does not ban crypto treasuries but raises the bar by requiring a shareholder vote for many financings. This can affect the timing and pricing of deals, as companies will need to model the exchange rules in advance, including thresholds and exceptions.
Continued Interest: Despite the new hurdle, companies are still pursuing token exposure for balance-sheet management, payments experimentation, or equity-per-coin positioning. The first phase of the year's treasury rush delivered new listings, larger token reserves, and price volatility across small-cap names.
Nasdaq's Role: The exchange has started to apply the scrutiny, and issuers planning crypto treasuries now face a vote, turning the rush into a process that will run through shareholder meetings, proxy calendars, and compliance checks.